Falling inflation not worrisome, say economists

NEW DELHI: Sliding inflation, which has touched the lowest mark of 0.44 per cent since the Emergency days of 1975-76, is not something to worry about, say economists.

"I don't think we are heading towards deflation. It would be playing up (the issue)... This is not a thing to worry as yet," said Abhijit Sen, noted economist and a member of the Planning Commission.

Attributing sharp decline in inflation index to the base effect, he said, "Last year around this time, prices started rising sharply. The point simply is, one can't rule out some fall in prices because of decline in commodity prices in the global market."
The inflation earlier moved in the negative territory during 1975-76, the year the then Prime Minister Indira Gandhi imposed Emergency to deal with growing internal disturbances. The inflation dipped to 0.44 per cent for the week ended March 7, as compared to 2.43 per cent a week ago and 7.78 per cent a year ago.

"It (inflation) is nothing else, but base effect and it may fall in the negative territory in the coming weeks," Prime Minister's Economic Advisory Council chairman Suresh Tendulkar said.